Maybulk narrows Q2 loss, expects freight rates to rise further


KUALA LUMPUR: Shipping company Malaysian Bulk Carriers Bhd (Maybulk), controlled by billionaire Robert Kuok, narrowed its losses in the second quarter ended June 30 on the back of rising freight rates.

Maybulk posted a net loss of RM6.9mil in the three-month ended June 30 (Q2 FY2019) on revenue of RM68.7mil.

"Having weathered a weak Q1 in 2019, the Baltic Dry Index (BDI) regained some momentum and the freight market witnessed improvements across all segments in Q2," it in a filing with Bursa Malaysia today.

The firm expects the recovery to continue in the second half of the year.

"The world operating fleet is expected to reduce in 2H of 2019 as more vessels are taken off for scrubber retrofitting in preparation for new emission regulations which will come into force from Jan 1, 2020," Maybulk said.

"The added tonne miles from soya bean and iron ore shipments together with the reduced world operating fleet should help improve freight rates in 2H 2019," it added.

For the first half of the year (1H FY2019), Maybulk registered a net loss of RM17.7mil compared with RM165.6mil loss made in the same corresponding period last year.

The huge losses last year were mainly due to one-time impairment charge on a subsidiary that was disposed in October.

At operating level, the group's dry bulk segment reported a loss of RM3.5mil in 1H FY2019, compared to a loss of RM4.76mil previously.

On Jan 1, the group adopted MFRS 16 leases and accordingly reclassified the leases of five chartered in vessels from operating lease to finance lease.

The combined depreciation on right-of-use assets and interest expense on lease liabilities for these vessels in 1H FY2019 was RM4.9mil lower than the charter hire expense previously recognised in 1H FY2018.

"Including impairments (relating to the Group and JVs), loss on disposal of vessel and onerous contracts, the dry bulk segment’s loss increased to RM14.1mil in 1H FY2019, compared to RM4mil loss in 1H FY2018 mainly due to loss on disposal of vessel of RM12.3mil," it said.

Meanwhile, its investment holding and others segment reported a loss of RM3.4mil in 1H FY2019, compared to a loss of RM161.2mil in 1H FY2018.

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